Saturday, November 28, 2009

An alternative to the free market economy

Many people dream of being a multi-millionaire. They love the free market economy, as it gives them the opportunity to pursue their dream. Let us stop chasing this dream for a while and reflect on what this issue is all about.

At any time, there is a limited number of assets in the world. These assets have to be shared by the people. If some people are multi-millionaires, other people have to be poorer to allow the rich to own more of the limited assets. This leads to income and wealth inequality.

It is possible for the world to produce more assets to be owned by more people. However, the over-production has lead to a depletion of the natural resources, damaging the environment and leaving less resources behind for the future generation. Is this what we really want? Do we really want to work hard to accumulate more assets than is really necessary? What about spending more time for family and friends?

Many people do not have the choice. They have to work hard to keep a job. Other people gets unemployed, so they have to offer their labor at lower rates to compete for the same jobs. This allows the business owners to make more profit and be richer.

This is what has been happening during the past two decades with global competition and the free market. It has lead to wide disparity of income and poorer living conditions for many people, while a few becomes super rich.

My observation is not new. It has happened in history. I am bringing the great philosophers of earlier times, such as Confucius and Karl Marx. Spend time to read about their teachings.

These philosophers tell us that there is an alternative system to the free market and competitive business environment. Do not be misled that the free market environment, that we are used to in recent years, is the only way or the best way to prosperity and a happier life.

Tan Kin Lian

7 comments:

C H Yak said...

Quite often, there is more good than adverse as preached by these philosophers. The complications often come during their implementation.

For instance, Confucianism preaches "country as a family" before your "own family". Hence, interest of the country is placed before self-interest.

But see what happens in countries where it is still widely followed. In South Korea for instance, the interest of family business conglomerates or "chaebols" has traditionally been placed before the country's interest and skewed and influenced their politics.

Around us, we have seen other families of politicians being caught in the route to secure more family wealth and through all available means.

In our own country, politicians have to be paid high salaries to entice them into politics, i.e. self-interest is watched before country-interest. Because this is also linked to their family wealth.

In Communism, where the "family wealth" is taken away for common ownership, the problems lie in the preaching of a "propaganda" and if "propaganda" fails, a ready " militaristic struggle" to achieve its political agenda.

Propaganda can be subjected to abuse as in China under the Gang of Four, even a great leader like Mao can be confused by the Propaganda. A militaristic struggle can be wrongly directed. Hence, even during the June 4 Event in China, there was even a internal split of decision within the Poliburo. It was lucky for China that after that event, the leadership in China was more "state-centred" than perhaps "family centred" during Mao's era.

In a way, communism evolves even more under Deng Xiao Ping's leadership and modernisation campaign. So it is not surprising they have their own "democratic" ways. Where the polticians on top cannot make it "domocratic and fair" for the common people, the common people can "DIY" in their implementation. This is something interesting. At least in this respect, they are more intelligent than us, Singaporeans.

Along this spectrum between being a democractic free market economy and a communist welfare state, there must be a more workable solution. Taking away "family related interest" and "self-centredness" is an important criterion.

Anonymous said...

Karl Marx idea will be the BEST, but only if HUMAN can be LESS SELFISH.

Let me ask you this question:
If you and I are paid equally regardless of efforts and results that we will get, what drives you to work harder and produce better results than me?

If you are not a selfish person, then you will NOT mind working harder and producing much better results and yet still get an equal pay.

If you are a selfish person, will you?

So, a System or an Idea might be great, but when implemented, it MIGHT not just be as great!!!

Karl Marx had a great and brillian idea, but its implementation is just IMPOSSIBLE to achieve a better world than what capitalism can achieve.

Big Guy!

Anonymous said...

The solution is free market economy with intervention from the government to provide certain benefits like education & health at a nominal fee, unemployment benefits, old age pensions and other social security safety nets. Where to draw the line and how much to pay is up to each society. It can vary from the Scandinavian countries to Singapore where the government provide the bear minimum.

The tax structure should be such as to provide incentives to work hard and at the same time tax more on those who earn more.

If we allow a free for all type of economy it will eventually lead to social unrest and every body will lose.

Anonymous said...

there are people who just can't think out of the box maybe it stems from a sterile education system or herd mentality or that the propaganda machine has done itself a disservice - in the LONG RUN.

the Devil's Advocate said...

i am not against working hard but working hard towards what? low birth rate, potentially early death, no retirement especially for MENIAL WORKERS( a large proportion of the workforce are working like robots or brain dead jobs), no time to build real relationships etc etc

i think a lot of people are not clear and therefore misled by capitalism.

Anonymous said...

I'd say one important value that we need to promote constantly together with the working of capitalism is compassion.

Big Guy - Mui Mui!

Anonymous said...

The pursuit of money for money's sake has drained us of time and love for our neighbour.
That is one reason why religion has seen a revival.
The spirit needs guidance.

Our country has gone too far down the line, and the grumble has grown.
But we are too afraid to tip the scale to a point of no return. Not yet.

We have relied on KPIs and ROIs to guide us. They are useful. But there must be balance and it must be encouraged to think more humanly.

Although, being a CEO running a charity is to be compensated, lets be intelligent: a person applies to become part of a charity because of a higher calling.

Becomming a member of parliament is a higher calling.. because you want to make a difference.

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